Conference 7.286::digital

    Have you asked these questions of your personnel rep?  The Restricted
    Stock Option Plan is explained in a formal prospectus that, as far
    as I know, available to all employees or shareholders (for that
    matter).

  To the best of my knowledge, the restricted stock options are 
  distributed on something akin to the trickle-down theory.  But 
  I'd like to know more details as well.  Pat, do you know for a 
  fact that the intimate details of distribution are available in 
  the Prospectus, or does it just say something like "distributed 
  to highly valued employees of the Corporation" or some such?

                                   Atlant

    
    Check out note 837.6 in BMT::INVESTING
    

    I'd like to thank .-1 for pointing me to the investing notes...yes
    I read that and I have two comments...
    
    1) The person that wrote that is obviously concerned about
    retribution.Is this a taboo subject?
    
    2) It looks like DEC is giving away stock to selected employees...is
    that a correct assumption?

>        2) It looks like DEC is giving away stock to selected employees...is
>           that a correct assumption?
        
    Why do you get the impression that DEC is "giving away" stock to
    "selected" people?  The stock is offerred as an incentive for those
    that "are presently making and continue to make substantial
    contributions to the successful growth and development of the Company"
    (from the prospectus).  Of course, the employee has to buy the stock
    at a (usually discounted) price -- it's not free.  The price is
    set by the BOD and is not less than the book value per share at
    the end of the prior fiscal year or 50% of market value.

	I think stock is given as an incentive to high level grade jobs-
	Ie, grade 10-12..  When you hit this grade of job level,
	you to may be given these incentives..  Until then, you
	buy it just like all us other "lower grades"
	/Robin

re:  Note 524.5  Thanks, I'll check it out.
re:  Note 524.4 

<    1) The person that wrote that is obviously concerned about
<    retribution.Is this a taboo subject?
    
 
That's not correct, I'm not "concerned about retribution".  My original
notes was worded as it was so that the replies wouldn't be:

a) of the tutorial type:  I already know how stock options work.

b) misinterpreted: I don't attribute any wrong doing to anyone who
		   grants, receives, buys, sells, etc. Digital stock
		   options.


What I'm trying to do is:

a) Find out the rules.   Who gets 'em and why?

b) Make the editorial comment that I would like to see all employees be
   considered.  (Maybe we all are but I don't know that.)

My "concern" is that I, me, moi, don't have any and I want to know why and
what I have to do to remedy the situation.

    Re: .-1
    
    I'm sorry if you got the wrong idea...I was referring to the person
    who wrote 637.6 in the investing notes as being concerned with
    retribution.My question still stands...is this subject taboo?
    
    Also,I realize that the stock is not *free*,but sold to the employee
    at a bargain price.(a lot less than even employees can buy it under
    ESPP) 

    Re: .6

>	I think stock is given as an incentive to high level grade jobs-
>	Ie, grade 10-12..  When you hit this grade of job level,
>	you to may be given these incentives..  Until then, you
>	buy it just like all us other "lower grades"

    There are no restrictions on levels.  However, the senior managers who
    are responsible for the allocation may consider that higher level
    people are making a more significant contribution to the corporation. 
    
    -  David

        I believe the discount is the same as the Stock Purchase Plan.

    No, the Stock Purchase Plan discount is an amount equal to 85% of
    the fair market value.  Stock Options, while are specified by the
    Board of Directors, prices will be the lesser of a) the book value
    per share of the Common Stock by the end of the fiscal year preceding
    the date of grant, b) 50% of the fair market value per share on
    the date of such grant.
    
    

I don't know how prices are computed but they're NOT as good as 50% off, unless
there's yet another, less publicized plan.

-mark

    And generally, these are options to buy a certain amount of stock,
    at the discounted price, over a period of years (usually, if not
    always 10).  You get to buy 1/10 after the first year, then another
    1/10 the next.  Of course, you can schedule the "buy" to suit your
    own situation vis a vis things like taxes, financing, etc. Options
    are also an incentive to "stay with the company" since they usually
    lapse if you resign.
    
    Correct me if I'm wrong, but I believe these are some more of the basic
    facts.
    
    BTW, I appreciate the references to other notes conferences given
    occasionally. However, sometimes it's nice to have a short discussion
    on a topic, such as this, in a notes conference, such as this, because
    I (and probably others) don't always have the capacity to add another
    volitile and voluminous conference to our scanning.  thanks to those
    of you who do and who share occasionally cross-information with
    us.
    
    jack

    re: .12, since the option price is frozen at "gift" time, and since
    the price of the stock on the market certainly can rise, by the
    time the option is exercised, the differential can be substantially
    more than 50% (like buying at $50, adjusted by a split
    to, say $25, and selling at $200, for example).
    
    Just recently, Lee Iacoca's earnings for the latest Chrysler FY
    were announced at something in the range of 17+ million, and a HUGE
    chunk of that came from his execution of stock options he acquired
    back in the days when he was earning $1/year and getting Chrysler
    "back on the road."
    
    Jack

RE: .-1

	Or the effects of an October 19th can leave you with an option to buy 
at $50 over the market price!  The pendulum does have two extremes!

     Re. .12  - interesting that you so strongly say my numbers are
    wrong, yet admit you don't know what they are!.. My information
    comes from a reliable source, like the booklet given to those 
    receiving stock options.
    
    
    

The reason I don't know what the numbers are is that I don't know what the
algorithm is and as far as I know, is it not published.  There have been times
when options were indeed offered 50% below the current price but there were
also times they were only a few % cheaper.  As a previous note said, the last
options went for around $150, or $50 above the current salling price!  Using
the 50% rule as stated by .-1 would have meant that the stock would have to
have been around $300 somewhere in the last year which just ain't so. 

-mark

    524.18 is exactly the sort of note that gets extracted and circulated
    without the knowledge of the author, out of the context of the rest
    of this conference, and ultimately "negatively impacts" the career
    of the author without the issue at hand even being discussed.
    
    No, you don't get fired for this but I'd be more careful of what you
    say, KBS.  You see there are the Notes Police and then there are the
    Notes Secret Police... 

    I would like to suggest that the place to debate the fairness
    or unfairness of the special stock option plan belongs in
    SOAPBOX (BETHE::SOAPBOX_1988 or KP7 to add to your notebook).
    
    				Alfred